now coming to DHAMPUR the amount of inventory it is sitting on it will cross the EPS of 45-50 by Q3.
now what P.E ONE SHOULD give it…if we gave lowest of P.E. of 3(it is very low) the price comes to 150/-…is it looking bad.??
Remember “INDIA HAS NOT SEEN REAL DEFICIT TILL NOW” real deficit will be seen in SUGAR year 2016-2017.NEWS of worlds 2nd largest producer (INDIA) importing sugar will send the Sugar11 futures soaring
Best Regards
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Mahi: this discussion thread was comatose till I made a post in Sept 2015 (post numbers 65, 66 and 67 dated 3rd Sept 2015) clearly pointing out with charts the beginning of sugar upcycle…in the same post I pointed out bottom formation in Balrampur @40 …I had clearly written that such a signal happens on transition from bear market to bull market.
If you want you can go through that post. And as usual it was met with a lot of skepticism from other borders…all were talking about the reports and predictions of Czarnikow, Rabo Bank, etc regarding excess sugar production.
The point that I am trying to make is…yes there are clear signals that the market gives at the beginning of the rally and at the end of the sugar rally. At bottom the extreme pessimism makes people ignore the uptrend signal and at the top extreme optimism makes people ignore the downtrend signal.
So far in this rally…there is no signal either from fundamental side, or from topping pattern of sugar stocks or from pattern of domestic sugar prices or the international sugar prices that the sugar cycle has turned down.
We can only say that this is a deep consolidation in a bull market…
Those who are saying that the uptrend in sugar stocks is over have not substantiated their assertion in any way…
The real sugar shortage will be felt from Oct 2017 onwards…till then even the govt accepts that sugar prices will have an upward bias.
If you study the previous sugar rallies, you will find that these are the most volatile of all rallies…there have been occasions when sugar stocks have fallen by as much as 50% in the bull run. Compared to that the present fall has been quite modest.
At the beginning of the present bull run Dhampur rose from 29 to 80 rupees and then fell to 46…again it rose to 90 rupees and fell to 56 in February 2016…the present fall is from 137 to maybe around 104…
Compared to this kind of volatility in a fundamentally very good sugar stock such as Dhampur, the present volatility in Upper Ganges, or Dwarikesh is not that alarming. Just look at the book price of upper Ganges or Dwarikesh or Oudh sugar…for the sister company of Upper Ganges …I.e Oudh sugar the book value is minus 47…if such stocks do not fall, don’t know who else deserves to fall…
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We can analyse this story the other way round too…
Let us accept the bearish assertion that the sugar upcycle is over…and sugar prices and sugar stocks are headed downwards…
Just look at the debt figures and balance sheets of major sugar mills - Bajaj Hindusthan, Renuka, Sakthi, Simbhaoli, Mawana, Oudh etc…if these companies are not able to repair their balance sheets and reduce their debt in the upcycle, then all these companies will collapse and shut down within the first year of the coming bear cycle. That will take out around 6-7 million tons of sugar making capacity in India…
Thus from next year onwards, India will enter a multi year (5-6 year long) sugar bull market…and those invested in stronger sugar companies such as Balrampur, Dhampur, Triveni, Dalmia, Parrys etc will make 50x to 100x returns.
But as Howard Marks and Franklin Templeton say…a cycle is a cycle…and will remain so. And what the bears are predicting is the end of cyclicality in sugar sector…while I am betting that sugar sector continues to remain cyclical…
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The bears are arguing against cyclicality by totally ruling out the bullish phase…on the other hand, bull case is that…there has been a 6 year long down cycle and there is now an upcycle which will last atleast for one more year…how can it be a cyclical sector if there is no upcycle…
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Whatever being said… this fall in Rana,Rajshree,UGAR is brutal… Portfolio shape has changed. Big lesson for me… never invest more than 15% of your portfolio in any cyclical sector … unless u are staring at the cusp of the bill cycle with long-term bottom in the share prices…
I caught these in the last 3 months during their upturn and lost the capital … hopefully by end of the year we will see these scripts reaching their 52w highs again
In Nov 2015, in a TV interview to Rajdeep Sardesai, Nana Patekar pointed out that in rural Marathwada, there is no drinking water even in Nov and God knows what will be the situation in Summer (March -june 20016).
A perceptive investor would ask…if there is no water to drink, then will there be water for a water guzzling crop like sugarcane? This laid the foundations for beginning of sugar rally in 2015…
In March 2016, a group of BJP MPs from Maharashtra met PM saying that 40-50% of the sugar mills in Maharashtra won’t even open in the next sugar season due to absence of sugarcane…same is the case in Karnataka as told by the state cabinet minister. This itself shows that sugar production will be closer to 20-21 million tons.
Thirdly, as is clearly written in Rangarajan committee report, in years of sugarcane shortage, there is more diversion of sugarcane to jaggery / gur sector…if it happens this time too (as it happens always), then the sugar production may be around 20 million tons…this is the figure SP Tulsyan too is talking about…
…and then people are saying, the upcycle / bull market is over? LOL
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Yeah, I too have read this somewhere (can’t recall the source). It is, afterall, the logical thing to do. Since, Gur is a poor man’s sugar.
I agree that we cannot accurately predict as to what level the stock can reach but we can always find out if the consolidation is showing signs of ending…In Balrampur I not only pointed out the bottom @ 40 but on valuepickr forum posted charts and pointed out the end of consolidation @ 78, 107 and 119…I have posted charts on similar lines for Dhampur too.
Even before the present bout of fall, I had written about 1-2 month long correction in sugar sector and given precise points to add more of sugar stocks during this buy on dips fall.
I wrote a post addressed to Mahi that Upper Ganges was in bubble territory and appeared to be a part of some pump & Dump scheme before the stock fell with such ferocity…its all available on the present discussion thread.
What more do people want from investing…is it not enough if we know the approximate entry point, the points at which to scale up our positions and the approximate exit signals / exit prices. Buy when the price is low enough and sell when the price is high enough…what is it if not investing in real sense of the term…why call it speculation or gambling?
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Thats was i was saying REAL DEFICIT IS YET TO COME and seen by INDIA …production will be well below 22 million tonnes…against forecast of 23.26mt and consumption of 26.5mt…
And when worlds 2nd largest producer (INDIA) imports u know the effect on international sugar prices…
Once sugar futures crosses 23cents and stays above that…that will open the way for 30cents.
Regards
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On 5th August when Upper Ganges was @ 466 and Dwarikesh was @ 320 I wrote the following post on valuepickr forum:
Mahi: I don’t have much to say about Upper Ganges and Dwarikesh…except that if you have purchased at higher price, then you may get one more chance to exit at higher levels…otherwise for the next 1-2 months the stocks may gradually come down to much lower levels…If you are already in good profits, then it might be prudent to book profits in these stocks and shift to Balrampur / Dhampur…its your call.
Both Upper Ganges and Dwarikesh are in bubble zone and there may be some sort of pump and dump thing going on there.
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My post on upper ganges dated 2nd July2016. I had also pointed out the exit strategy to be followed in Upper ganges…
In my opinion, as soon as the band width starts contracting, investors of Upper Ganges are in huge problem.
Of course, I may be wrong and the stock may keep rising…
…but still…at some point of time this bubble will burst…and that will be indicated by the contraction in band width…
If this exit strategy were followed, then Investors would have made exit in Upper ganges @ 460…not at the top but after a good enough profit
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Dharani Sugar and Ugar Sugar look good. Stocks have been battered out of shape.
Back to back 2 20% LCs in Dharani…12 Consecutive days of LCs in Ugar. Daily RSI at extremely oversold levels in both… May be promising to increase exposure in Non-U.P. based mills. For diversification outside of U.P. to mitigate poll promise risk to farmers.
@Mehnazfatima What do you think Ma’am?
DISC: Invested in Balrampur&Dhampur
P.S.: BTW Both Balrampur and Dhampur also look way oversold on RSI.
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My dear @Mehnazfatima . How i wish i should have paid attention to your views. As i said previously we hide gains and show losses. I guess my greed got better of me and i ignored every view which countered my decision to stick to my portfolio of Upper and Dwarikesh.
But on the other hand ,i don’t want to sound rude, these observations which were given by you( I am very thankful) you mentioned stock may comedown to much lower level in next 1-2 months and very rightly they are at lower level . If we look now this downfall has come for all stocks not just upper and dwarikesh. Correct? So i should say it was an observation for all stocks but given for two.
Well you must have realized by now i am not a technical person at all and i would be very honest to admit that i did not understand the graphs which you showed a single bit. My thought process kind of 
. It would be appreciated for example if a person like me who is not that technical is told (as i am quite new to stock and already with burning fingers) how do we read these charts. A little description of what chart tells like name of chart so we can research more( I know i am being demanding here, sorry for that)
Now that i have admitted i would like to know more about these graphs so that i also can contribute by building such road-maps before thinking of making a investment. And it benefits all.
Having said enough i would like to thanks everyone for making this platform such a unique one where intellectuals interact and guide others. Where else would you see it. 
.
Good Night every one!!
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exactly @Mehnazfatima what caused this downfall? This is why i have been banging my head on the wall(not the real one 
). What caused it?[quote=“mahi, post:495, topic:657”]
these measures taken by government to correct share prices or to control sugar prices.
[/quote]
i am still looking for answers to my above query?
Coz till the government intervened and took steps like banning futures, ethanol subisdy everything was smooth and stocks were either stuck at one price band or were moving very slow. Who gets these news first or how to guess from stock movement that something strange is about to happen soon( soon = may be 7 to 8 days) .
Sugar prices in Mumbai are around 3811 a quintal up 2% since July 1st while in Bengaluru it’s up by 3%. This has happened despite govt having forced Mills in UP n TN to release their stocks. Now the govt is behind Mills in Maharashtra and Karnataka.
A) I wonder if Mills in Maharashtra and Karnataka have any significant stocks as they had borne the brunt of the draught.
B) Now that many Mills in UP and TN also have less stock what will.prevent prices from shooting up in the markets
C) The 2nd qtr results of sugar cos will be significantly better than the 1st qtr as they would have sold more sugar.
All in all a good opportunity to buy shares of companies that had significant stock position as they can sell in the next qtr as well by when the price in the domestic market would have shot up even more.
One more outlier positive is that with rapid progress of monsoons fruit and vegetable prices have fallen dramatically in the last 15 days. This will make the govt a little easy on sugar prices and their inflationary impact.
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Exactly…it would be great if pulses the main culprit falls heavily…govt ko pareshaan daal ne kar rakha hai 2 saal se…this time bumper sowing has happened …hope for bumper crop tooo…then pulses price will crash amd govt. Will be relieved from one side and also inflation figures will be under check…so govt will not run hard against sugar at todays C.M.P. atleast…
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Another bad day in Sugar stocks in offerring.
Price Action suggests bear market is looming large but fundamental suggests otherwise, do not know what to do…May buy Dhampur some bit today…
I am waiting to buy when the fall is over and stock turns around…it may be a little lower or a little higher from the present level.
Sugar stocks bounce back. Ugar in green and so are ballu and dhampur
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Yeah…will have to wait till closing time and see…if it closes in green, then its a first sign of bottom formation…
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